Strategy formulation has been acknowledged as one of the most crucial factors of ensuring the long-term growth of the business. However, the manner in which strategy is formulated, and most importantly, the nature of the strategy chosen for the company determines its future position in the marketplace (Grant, 2005).
This article presents is a critical analysis of the article “Strategy as Revolution” published by Gary Hamel (1996) in Harvard Business Review. The article clarifies the position of the article within the wider debate about the processes of strategy and highlights the main strengths and weaknesses associated with the article.
The Placement “Strategy as Revolution” within Processes of Strategy Debates The traditional strategic planning process as informed by NetMBA (2011, online) occurs from top to down and consists of mission, objectives, situation analysis, strategy formulation, implementation and control. However, Hamel’s (1996) “Strategy as Revolution” challenges this viewpoint by stating that strategies have to reflect the viewpoints of employees at all levels in general, and employees from tactical and operational levels in particular.
Azar and Brock (2010) specify change to be an integral part of effective strategic management. In other words, authors argue that effective strategic management has to introduce necessary changes into various aspects of the business that would contribute to the firm’s competitive edge. This viewpoint is further developed by Floyd et al (2011), who stress the importance of new ideas in terms of introducing necessary changes into the current business strategy.
“Strategy as Revolution”, on the other hand, confirms the both viewpoints formulated above, at the same time when specifying that changes to the business practices need to be dramatic, and the new ideas have to be derived mainly from employees other than those holding formal leadership positions.
The importance of strategic thinking for managers is stressed by Jarzabkowski and Balogun (2009), whereas the main agenda of “Strategy as Revolution” is to urge managers to include employees from lower rank in the formulation of strategy.
Farjoun (2002) and Sminia (2009) divide perspectives on strategic planning into two groups: top-down and bottom-up. The top-down perspective starts with scanning business environments and results in setting targets and allocating resources, whereas bottom-up perspective is more concerned with analysing trends in sales and customer behaviour as primary stages of strategy formulation.
The main idea formulated in “Strategy as Revolution” corresponds to the second viewpoint, and takes this viewpoint to the next level. In other words, as Jarzabkowski and Spee (2009) confirm, strategic planning should not consist of achieving incremental improvements, but revolutionary approach has to be adopted in terms of achieving sustainable competitive edge through reinventing the industry.
To summarise the position of “Strategy as Revolution” within the debates related to the processes of strategy it can be stated that the article has contributed to the acknowledgement of the advantages of bottom-up approach to strategy formulation to a traditional alternative – top-down approach.
Numerous works have been devoted to the same issue since then that include the works of Schmidt and Treichler (1998), Kaplan and Norton (2001), Grant (2005) and others. However, the practical value of “Strategy as Revolution” is that the article has been among the initial works to shed the light to the issue of the strategy formulation that adopted an alternative approach to the traditional top-down approach.
The Contribution of the Article to Strategic Management
“Strategy as Revolution” has contributed to the area of strategic management in practical level in a number of ways. First of all, the idea Hamel (1996) aims to communicate is divided into ten...